Friday, March 17, 2017

China & EU to End Anonymity of Bitcoin. Its Price Drops.

It has been a tough week for bitcoin. Chinese central bank, EU's top law enforcement agencies and legislators are deliberating to end anonymity of virtual currencies. As a result, bitcoin price dropped significantly.

CHINA

The Chinese central bank, People’s Bank of China (PBoC), is currently circulating new guidelines which, if enacted, would require domestic bitcoin exchanges to identify users and report suspicious trading activities to authorities. Zhou Xuedong, director of PBoC’s Business Administration division, recently suggested creation of blacklists against exchanges that do not follow PBoC’s directives. China's “big three” exchanges (Huobi, OKCoin and BTCC) halted bitcoin and litecoin withdrawals while undergoing upgrade of anti-money laundering systems. The PBoC now awaits feedback on its proposed guidelines from the exchanges.

EU

On Monday, EU's top law enforcement agencies have released a joint report stating that encryption, loss of location and lack of cohesive legislation on digital currencies make it difficult to "follow the money" while fighting cybercrime.

This comes at a time when Members of the European Parliament are deliberating new legislation to end the anonymity of cryptocurrency and allow “competent authorities... to monitor the use of virtual currencies” in order to fight money laundering and terrorism.

PRICE DROP

Bitcoin price dropped approximately 10%. From US$1,200's earlier this week to US$ 1,074.02.